NEW Week In Review By Charlie Fox
Charlie Fox – 04/08/23
Farewell to the 53 rd Parliament – Welcome to the Election Campaign and a new future for Shelly Bay – 20/08/23
Last week saw the final wrap up of the 53rd Parliament, and then our politicians got straight into the election campaign proper.
Of course you’d be forgiven for thinking they’d been campaigning for weeks or even months, but the week ended with official campaign launches from both Labour and National. The Greens, Te Pati Maori and New Zealand First all launched their campaigns in July, while ACT doesn’t launch their campaign until September 17. It feels like they’ve all been campaigning for months already!
Labour’s launch centrepiece was the promise of free basic dental care for 18 – 30 year olds, with up to 18 already free for basic services. Leader Chris Hipkins also got his nashers stuck into National, extolling Labour’s achievements, saying they would all be at risk under a National-led Government.
National’s launch was upbeat, already having dominated the week with their long-awaited tax package. Unlike Labour, National’s package is at least intended to be fiscally neutral, though there are question marks about tax collection costs, and how much tax will be raised by their intended new online gaming tax and through taxing some foreign buyers of residential properties worth over $2 million. National promises tax reductions for lower and ‘squeezed middle’ income earners up to $78,000, paid for through other targeted taxes and reductions in ‘backroom’ bureaucracy. It’s clever politics as people earning $80,000 get as big a tax reduction as those on $800,000, who let’s face it probably aren’t quite so ‘squeezed.’ Income tax brackets would be adjusted every three years to compensate for inflation – finally addressing so-called fiscal creep which drags more and more people into higher tax brackets because of inflation. Auckland’s fuel levy would go, as would Labour’s plan to increase fuel taxes. While Hipkins said Labour’s achievements would be at risk under National, Chris Luxon painted a picture of little achievement under Labour and an increasingly divided country, failing economically and in delivery of core services notably health, education and law and order. Two Chris’s – two completely different pictures.
One key difference in the pictures painted by the ‘left’ and the ‘right’ is their very different levels of focus on economic growth to pay for services. Ultimately everything relies on the economy. Our current account deficit (that’s goods, services and investment returns we earn overseas against what we buy) in the year to March was the worst in the OECD. The longer that is maintained the more we are borrowing from other nations to fund our lifestyles. That’s an even bigger problem when they haven’t got the money either. The Global Economic Crisis of 15 years ago was tough but New Zealand was significantly insulated by the demand for our products from a still growing, voracious China. This week made clearer than ever that the indebted Chinese economy is stuttering and their demand for our agricultural products is declining. That’s bad for farmers, but also for rural and provincial towns. It’s also bad news for the tax take, which is bad news for all of us. There will be a lot of focus on the Pre-Election Fiscal Update – or PREFU – which Treasury will release on September 12 th . Depending on what that looks like there may need to be some very fast rejigging of election promises – all round.
Locally the big news was the purchase of Shelly Bay by Sir Peter Jackson and Dame Fran Walsh from Ian Cassels’ Wellington Company ending its controversial plans for a large-scale apartment development. Possibly those plans were coming unstuck because of changes in financial conditions and rising construction costs, and maybe because of difficulty in financing such a large development with such a long construction timetable. Jackson and Walsh’s purchase and their intention to focus on environmental restoration and possibly arts and recreation has been widely welcomed.
-Older-
David, Grant and the Great (GST) Boondoggle on the Road to Damascus – 20/08/23
A Boondoggle (meaning) ‘An unnecessary, wasteful or fraudulent project’.
The Labour Government is in a rush – to get legislation passed, to slide new legislation (lowering the voting age for Council elections) into the system before Parliament finishes and all the parties get even more focused on the election.
The Labour Party is in a rush too, unveiling new policies. Prime Minister Hipkins has been at pains to say that the Labour Party and the Labour Government are two different things. That helps when you (the Party) are having policy bonfires for the things you (the Government) were once so keen on. Somehow you (the Party and the Government) appear to be hoping that we (the Voters) forget that you are the same people.
Environment Minister David Parker had some week, getting his replacements for the much maligned Resource Management Act passed, so the Natural and Built Environment Act and Spatial Planning Act are now law. The controversial Three Waters legislation also passed its final reading.
Transport Minister Parker also stood alongside Prime Minister Hipkins to announce the Labour Party’s new transport plans. The policy bonfire was burning bright as the Labour Party discovered it liked building new roads, the kind that the Labour Government hated. We’ll have to pay more at the pump for the pleasure though.
Just as well David Parker is no longer Revenue Minster as well, having recently resigned from that job when the Wealth Tax he’d been working on got put on the bonfire by the Prime Minister. That saved him from having to join Finance Minister Grant Robertson in explaining why taking GST off vegies and fruit which Robertson had previously derided as a ‘Boondoggle’, that is ‘An unnecessary, wasteful or fraudulent project’, is now a great policy.
At the GST policy announcement Robertson said “I don’t want to present myself as any kind of saint, but I’ve been on my own road to Damascus when it comes to the announcements we’re making today”
The original road to Damascus story of course was of Saint Paul, who was originally named Saul and had been vigorously persecuting early Christians. The story is that he met Jesus on the road to Damascus and, immediately realising his error, converted and became probably the greatest Christian disciple. That was some conversion! So is Grant’s, but his explanations seemed less convincing. Perhaps the Lord giveth (GST cuts) and the Lord taketh away (increased petrol taxes)?
Hard to know who Grant’s God was on his road to Damascus, but he seemed to place great confidence in the newly appointed Grocery Commissioner’s miraculous ability to convert the ‘unnecessary, wasteful and fraudulent’ Boondoggle into great policy.
Economists and commentators across the board aren’t buying it and panned the policy as complex, with administrative costs eating up much of any gains. Luke Malpass of Stuff, which has generally supported Labour, was particularly scathing calling the proposed change ‘the idiot cousin of Labour’s craven desperation,’ a ‘cynical policy’ and ‘a contender for the stupidest and most principle-free decision of a major party of this election campaign’. Ouch!
Last word to David Parker who repeatedly declined to answer questions about whether the GST policy would work and whether consumers would actually see savings, simply saying several times ‘I support the Labour Party policy.’ Saying so much by not answering the question! At least he is clear that the Boondoggle remains unnecessary, wasteful, and fraudulent. He knows it, we know he knows it, he knows we know we know it, and is saying so without saying so.
Charlie Fox – 13/08/23
What a stupid question! With polls showing the Winston Peters and New Zealand First increasingly likely to get back into Parliament journalists are fretting about whether National rules them in or out, given Peters has already ruled out working with Labour.
By convention any incoming Government needs to show the Governor General that it commands ‘the confidence of the House (of Parliament)’, meaning that it has the votes to govern and particularly in matters of ‘confidence and supply’ meaning it can survive a ‘vote of no confidence and pass a Budget.
Let’s say National and ACT win a majority without NZ First, the issue doesn’t arise, though National might want to keep some insurance for future elections as they did with a very different Maori Party under John Key. But what of the entirely possible situation where neither Labour-Green-Te Pati Maori or National-ACT have a majority without New Zealand First?
To form a Government either side, and it looks like it would have to be National-ACT, would need to talk with NZ First. They would have the options of having an agreement to form part of the Government, or to have an agreement to provide confidence and supply undoubtedly in return for agreements on a policy programme. In either situation the more that a high level policy programme could be locked down the more certainty the Government would have because otherwise each initiative not previously agreed would need negotiation to pass. If there were no agreement of either type then essentially neither Chris could say they have ‘the confidence of the House’ and we would in all probability need a new election. That has never happened before under MMP and would be another blow to an already fragile economy and our collective standard of living.
So perhaps the question journalists should ask Christopher Luxon and David Seymour about Peters is ‘What will you do if New Zealand First does hold the balance of responsibility?’
There are four choices
- Work with NZF in the Government
- Work with NZF on the cross benches
- Tell Peters to work with Labour
- say we are going back to the polls.
Journalists might also ask themselves whether they really should expect an answer to that question now. Surely that would involve the parties doing some serious talking first to see if they could put a governing arrangement together. Journalists should also ask themselves why – beyond courtesies – would the party leaderships invest all that time in talking now during the busyness of an election campaign when as Luxon has been saying and Peters has often said, the question is hypothetical until the votes are counted. They should also expect that if the situation does arise the party leaders would have the maturity, for the country’s sake, to talk. Luxon’s best answer to the stupid question might be to give them a lesson in constitutional arrangements by asking them a question in return.
Charlie Fox – 04/08/23
Is LGWM to bite the dust, how big is your ‘fiscal hole’, who knows best how to plan parental leave, and how many Labour MPs?
Another big week in politics. They probably all will be until the 14 th of October!
National released its transport policy this week. In Wellington National’s intention to dismantle the controversial Let’s Get Wellington Moving organisation was absolutely no surprise. National plans to focus on the parts of LGWM it likes – a second Mount Victoria tunnel and fixing the Basin Reserve, while binning LGWM’s light rail preference in favour of buses. While this will upset many Wellingtonians, many more will be delighted as LGWM had progressively morphed from being pro- biking, walking, and public transport to also being quite nakedly anti-motorist.
Prime Minister Chris Hipkins was also unenthusiastic about LGWM’s slow delivery record, despite it being very much a Labour creature. It was bewildering hearing him now distinguishing between the ‘Labour Government’ and the ‘Labour Party’. Sure you would expect Labour to go to the election with new ideas that it hasn’t yet got around to while in Government, but you wouldn’t expect them to be repudiating the very things they have been enthusiastically pushing while in Government. It just adds to the confusion they created last week about tax, and becomes ever easier to wonder ‘do we really know what Labour believes and do we really know who they are?’
Speaking of Tory Whanau, WCC’s reaction will be interesting. Predictably independent councillors like Nicola Young and Diane Calvert were delighted. Mayor Whanau however panned National’s plans as ‘a backward step for Wellington’, as ‘outdated’ and accused National of having a ‘flaccid vision’. This is potentially both a marketing problem and a real problem for her. Whanau’s number one election campaign platform was her self-proclaimed ability to build bridges between parties with different views. We attended several election meetings and often heard Whanau say she was certain she could work well with any incoming National – ACT government. However her response to National’s transport announcement doesn’t suggest that relationship would start any better than her recent efforts to engage with the residents of Oriental Bay when she allegedly stormed out of a public meeting or in fact with a large part of her own Council, which is looking every bit as divided as its predecessor. To add spice to the story ‘The Post’ has now confirmed her recent ‘do you know who I am?’ night out was in the company of a $500 an hour consultant just hired by, yes, Let’s Get Wellington Moving. Given LGWM has become synonymous with slow delivery and consultant costs, ratepayers who have just received their latest – increased – rates bills might feel that really is not reading the room.
On Wednesday came bad news as the economy slows, of an apparently ‘massive fiscal hole’ in Government’s budget and of instructions to all public service heads to find savings. The size and impacts of this ‘hole’ will become clearer in coming weeks. We wonder whether Waka Kotahi will extend any search for savings to Let’s Get Wellington Moving?
Labour did get a big win on Wednesday with the teachers’ pay agreement. Parents will celebrate the end to strike disruptions of children’s education. However also Wednesday Labour shot down Nicola Willis’ Bill to allow parents to choose how to arrange their paid parental leave entitlement to best suit their own circumstances despite National, Greens, ACT and Te Pati Maori support. This was dumb politics and ‘we know best’ at its nitpicking worst. Centralising education, health, water and urban planning is one thing, Government deciding how families organise themselves to care for their newborn baby in the context of whatever other unique childcare and medical needs they have is as Willis, a mother of 4, put it ‘insulting.’ Political lesson one – never interfere too much, too personally, in the lives of too many.
Another big political event of the week was Monday’s release of Labour’s list. Current Cabinet Ministers are ranked at the top of the list. There doesn’t seem to be any demotion of ex-Revenue Minister David Parker (ranked 13) or incumbent Finance Minister Grant Robertson (ranked 4) following obvious disagreements with the PM over tax policy.
Rankings matter because on every poll many Labour MPs will lose their seats, and depending on electorate results this would include several prominent Ministers. The Roy Morgan poll out Tuesday would’ve further jangled nerves with Labour sliding 4.5% to just 26%. Wednesday’s Newshub Poll did have them higher at 32.3%, but still down 3.6%.
Significantly Roy Morgan also said twice as many of us (60.5%) think the country is going in the wrong direction as think it is going in the right direction (29%). For comparison the last poll before the 2017 election had 62% right direction, 25% wrong direction, and before the 2020 Covid election a whopping 70.5% right direction, 19.5% wrong. However as they say a week is a long time in politics and we’ve got 10 undoubtedly intense weeks before polling day. Labour won’t want more weeks like this one.
All Labour’s Wellington candidates will need to win their electorates if they are going to be in Parliament post October 14 th . Ibrahim Omer (Wellington Central) is ranked 37, former city councillor Fleur Fitzsimons (Rongotai) ranks 56, and Greg O’Connor (Ohariu) has chosen to go ‘electorate only’, but Labour holds sizeable majorities in all 3 seats.
Labour’s big name list demotions are previous frontbenchers Michael Wood (ranked 45) and Phil Twyford (ranked 49). Both should easily win their Auckland seats. Twyford of course imposed the controversial ‘we know best’ National Policy Statement on Urban Development across all our major cities, forcing Councils to dramatically increase building heights across large areas of our bigger cities. Twyford and Wood have also been the Transport Ministers overseeing our beloved ‘Let’s Get Wellington Moving’ which itself seems likely to be demoted regardless of who holds the Treasury benches post October.
Charlie Fox – 23/07/23
Leaks and a Disastrous Week for Labour | Charlie Fox
The tragic fall of Kiri Allan has dominated the political newsweek, with more news being leaking out daily. Earlier this year Allan and Michael Wood were both touted as potential replacements for Jacinda Ardern before the party settled on Chris Hipkins. The red flags were there – multiple complaints about office bullying including from senior public servants on behalf of their staff, criticism about misuse of power when dressing down Radio New Zealand over the non-appointment of her then partner to a key presenter role, the public breakdown of that relationship, controversy as Regional Development Minister in her performance over the future of the Ruapehu ski-fields, and then taking stress leave. In the background Allan had to battle through cancer which must have taken a huge toll and could well have impacted on her behaviour. Resignation this week was the only option but we really hope that she will get the ongoing support she needs at this time.
Allan’s resignation meant redistribution of her Ministerial portfolios. Alongside that, in another important development, David Parker resigned his Revenue portfolio saying it was ‘untenable’ to continue in that role after the Prime Minister’s rejection of the wealth tax proposals he and Finance Minister Robertson had been working on. That is a major problem for Labour because it further muddies the waters on what Labour actually believes on an important issue. This becomes even more important as the Greens and this week Te Pati Maori seek to outdo each other on encouraging anyone with wealth to leave the country. They are of course Labour’s prospective coalition partners.
And speaking of waters, this week we’ve seen not just one but two rare ‘leaks’ from within the Labour caucus. An unnamed first term MP told media they had been “bullied and yelled at” by Allan and that “we can’t pretend that we haven’t known about this for two years”. Then National’s finance spokesperson Nicola Willis publicised an apparent second leak that Labour will shortly announce an election policy to remove GST from fruit and vegetables. Keeping GST simple has always been a great strength of the New Zealand tax system. This time it seems Finance Minister Robertson is no fan at all of removing GST because of the significant complications involved.p
And still on leaks – that’s something residents of Wellington, Porirua and the Hutt are getting more and more used to. Wellington Water this week said that it estimates that around 40% of water that goes into the 4 cities’ pipe networks is lost through leaks. Wellington Water also told the Wellington Water Committee comprised largely of the regional mayors that the Councils financed renewing just 18km of ageing pipes in the last year when the ideal level is 100km. Porirua Mayor Anita Baker said her Council was spending ‘everything we can’. She is on record as hoping water reform will solve the situation but that fails to grasp that under water reform new pipes will still have to be paid for by you and I as water consumers rather than as ratepayers. Still that one will be good for landlords, and we suppose it also means the Councils can then blame somebody else. Maybe that’s washing your hands of responsibility for leaks?
Charlie Fox – 14/07/23
Tax! Tax! Tax! Wealth tax, capital gains tax (CGT). Everyone’s talking about tax, well at least the politicians and political commentators – and it matters to all of us.
Benjamin Franklin said ‘There’s nothing certain in this world except death and taxes’.
But while we’d generally prefer death to be uncertain, the what, how and why of tax is uncertain, evidently changeable, and in that it is fraught with problems. This month Budget background papers were released showing Government had done a lot of work in considering wealth taxes, capital gains taxes and a ‘super’ tax on bank profits before PM Chris Hipkins’ apparent ‘Captain’s call’ quashed it, much to the evident disappointment of Finance Minister Grant Robertson. The Greens also released their manifesto including a wealth tax kicking in at a relatively modest $2 million per person and from the first dollar for trusts.
So would a wealth or CGT tax be a good idea? The main reason for a new tax(es) appears to be to allow Government to spend more or give a bit more to people on low incomes. There’s a ‘fairness’ aspiration to try to make society a bit more equal. There’s a feeling that some people earn a lot of income through passive wealth and it should be taxed more to be fairer.
So what are the potential problems?
Leaving aside the big question of how well Governments spend our money, probably the biggest issue is the design of any system. What are the wealth or income thresholds a tax would kick in at? What is the tax rate? How if at all are the costs of holding assets including inflation and interest factored in? How expensive is the new tax to run? Critically there is the trust factor – how stable is ‘the deal’ from one Government or even one Budget to the next?
Most of us want as much certainty as possible in planning our financial futures. We might work all our lives aspiring to buy a house, invest for retirement. But do we trust Governments not to arbitrarily change the rules. Will they fail to inflation index so more and more people get caught? Governments which should be protecting our lives and property risk being the biggest threat we face. Long term, stable, multi-partisan agreement is essential to building trust and to people’s ability to plan.
A wealth tax is simply a tax on the value of assets. Income earned on those assets is of course already taxable. The big problem is that those assets may not earn income – perhaps it’s a business in early growth phase, a valuable house, a farm in a poor year. We need to remember some people will have a mix of home and business assets which could get counted together. There may be no cash so a tax becomes an (ever increasing) charge on your assets. Asset values can fluctuate significantly as we’re seeing with housing and equities, so conceivably you could even be taxed on declining wealth, and we presume you’d pay the not inconsiderable cost of regularly valuing the assets too.
A tax on realised capital gains at least means there is potentially cash to pay the tax, and the valuation is set by sale price. However a CGT should factor in:
– What you do with the money. For example is it ‘fair’ to tax you if you are just selling one asset – say your home – and buying another of more or less similar value? It might be you’ve owned your home for many years, saved and paid off your mortgage, but if a CGT applied you would have to take out a new mortgage for the CGT, not the house. Is that ‘fair’? A CGT then perversely would discourage people moving house, or potentially downsizing to free up space.
– Investment that has been made in upgrading the property while you owned it.
– Inflation in the period you owned the asset. After all inflation means money is worth less, not assets worth more.
– Interest paid while you owned the asset.
It is also critical to consider what wealth tax or CGT does to encourage or discourage investment. Yes, sure there are baches and AirB&Bs and some complain there’s too much investment in housing, and yet in the same voice we hear about a housing shortage. We need houses don’t we?
We’ve long been encouraged to save for retirement and to pursue home ownership. It’s an important bedrock of social cohesion. This week we’ve seen data confirming the obvious, a problem with a growing proportion of us retiring while still renting. Falling property values and higher interest rates have combined with other changes such as LVRs and non-deductibility of interest to reduce the number of leveraged investors and mean more first home buyers. That seems good. Buying rental stock currently only makes much sense if you expect capital gains. Not so good is a series of changes that all add up to discouraging new building.
Even if you think too much investment goes into housing, if a wealth tax or CGT is applied to all assets equally that affects productive assets – companies, equities, farms. It would likely make a lot of asset heavy businesses like farms non-profitable. It would disincentivise companies especially in that early period of growing smaller newer companies into larger ones when profit may be small or non-existent. It would drive investment overseas.
As a nation we’ve always relied on imported capital to finance – well everything. The less we invest ourselves, the more we have to borrow, the more assets we collectively end up selling, the worse our balance of payments, and the poorer our productivity. Our productivity growth is already very poor which affects our income levels. We’ve become less competitive over several decades, which is why we see more of the people with the skills we need being able to move for example to Australia for considerably better pay. So this stuff matters – to all of us.
Charlie Fox – 14/07/23
‘Do you know who I am’? Six small career-ending words made infamous by association with former MP Aaron Gilmore and now allegedly reprised by Wellington Mayor Tory Whanau. Mayor Whanau doesn’t have John Key to report to so this won’t have the terminal effect on her career that it had on Gilmore’s. Nevertheless there should be some hard lessons learned in this tale of two tipsy Torys.
1. There is no such thing as ‘private’ for political leaders
2. Own up to mistakes – and genuinely fix them. Whanau’s version of events is at odds with several witnesses. You are in big trouble when people stop believing you, and you certainly can’t fool everyone all of the time.
3. Kiwis don’t like entitlement. That probably comes from the colonial egalitarian aspiration to escape the European classist hierarchy. Here ‘Jack is as good as his master’. The great strength of democracy is that all politicians are representatives – and serve only at the collective will of the people. In democracy the people give, and the people take away.
4. Whanau has also previously been accused of missing many meetings and commitments. It’s one thing to be a ‘party girl’ but it’s a huge responsibility to be the Mayor of any place, especially a major city. Partying cannot be allowed to undermine the ability to do the job.
Meanwhile on the other side of town, National leader Chris Luxon has been campaigning in Tawa with his deputy and Ohariu candidate Nicola Willis. Local shopkeeper Michelle Cam was quoted in MSM telling him she’d heard a lot of ‘‘We want a change, but we don’t know who you are’.”
With just 3 short months until election day Wellington Live is sure we’ll get to see and know a lot more about Chris Luxon. If the polls are to be believed it is still all to play for, and how we get to know who he is will undoubtedly have a big impact on the outcome.
Two things for sure, come October we will surely know who he is without him having to say it, and the famously teetotal Luxon is unlikely to be tipsy on Courtenay Place.
The Golden Mile – A Tale of Two Cities – 02/07/23
It could be the best of things, it could be the worst of things. (apologies to my namesake) This week in Wellington it’s been all about the Golden Mile. (and the odd Ministerial infraction!)
Last week there was real anger in the room, a Retail NZ organised meeting packed with about 200 business-people, retailers, hospitality operators, building owners, a politician here and there.
Businesses are clearly very angry, with considerable justification, about the authenticity of LGWM’s consultation. They obviously do not feel heard. As we said last week, the key to public confidence in government institutions is authentic engagement.
Businesses fear the loss of customer parking will literally drive customers to Queensgate, Jackson Street and Porirua. They fear losing parking, not just on the Golden Mile but on its side streets, and they know LGWM is also looking at removing parking from Featherston and Victoria Streets and their side streets. They are also upset by more difficult access for servicing business, delivery and collection of goods, and having to get bureaucrats to approve access in special circumstances such as when tradespeople are urgently needed. Several hundred signed a double page spread advert opposing the plans in ‘The Post’.
Golden Mile project supporters responded saying it will bring more people, more customers, more life back into the city. They say that is what happens all over the world when pedestrianisation occurs. However, they do appear to ignore the cumulative effects of removing parking and servicing on multiple streets, and both undersell the proportion of visitors who come by car while saying it is still essential to remove them from the Golden Mile.
This week’s big Council meeting featured three debates on the Golden Mile and Thorndon. Cr Diane Calvert’s motion of no confidence in LGWM was defeated 9-7, funding for the two projects was approved (same 9-7 split) and a raft of traffic resolutions approved to allow them to go ahead. (mostly the same 9-7)
The last Council earned a reputation for being divided especially early on. This Council is clearly also divided, with up to 7 independents on one side and 9 Labour – Greens on the other. The big differences are that Mayor Tory Whanau has the luxury of majority councillor support, MSM has been curiously gentle to date, and there was an air yesterday that the independents knew they couldn’t win. However, the Mayor’s built her election campaign around extolling her own ability to ‘bring people together.’ That clearly hasn’t happened with councillors or the community. However there was considerable merit in setting up a business advisory group to work with business, and a recognition that all is not well with LGWM’s engagement at very least.
So totally different views. Will it rejuvenate the central city or destroy it? Who is right? Wellington Live looked at several pedestrianisation case studies. They are a mixed bag. Pedestrianisation has been around since Roman times. Older European cities have long had generally successful pedestrian areas. However in the USA about 200 pedestrian malls were put in during the 1960s, 70s and 80s, and most (80% plus) have subsequently been pulled out and cars returned because the malls were failing, retail was declining and people were staying away.
The US studies in particular had some valuable messages for success that LGWM and WCC might think about:
- High density residential and worker population in and around the area is important for success. That’s an issue particularly for northern Lambton Quay which has never really worked. It also puts the onus on Council and Government to maximise development in the Central City rather than scatter it around the city.
- Longer malls are far more likely to fail. The Golden Mile in its entirety is long. You can have too much pedestrian space if it is under-used.
- Having drawcard attractions close by is important. The Golden Mile is very strong on that count with many drawcard destinations on it or close-by.
- Pedestrian malls work better in cities with younger populations. Wellington has a relatively youthful population.
- A strong sense of place and character is important. On that score the Golden Mile is strong in some parts, poor in others.
- Good maintenance and attractive events to attract people to the area are important. The case studies tended to encourage business improvement districts which can be more focused than a Council ever would be. This would mean Council giving up some control for example over its Downtown Levy but that would be likely to be welcomed by business.
- Windows on streets and verandahs are important. The Golden Mile is really strong here.
- Ensuring easy access from surrounding suburbs to make it easy for people to come in is important. That means addressing severance for pedestrians, and good public transport and private vehicle access to parking nearby.
- Responding to competition from the likes of malls and suburban shopping is critical. Everyone agrees the Wellington CDB is already struggling following Covid and the loss of buildings (Civic Square and Thorndon in particular) due to the 2016 Kaikoura earthquake. Working from home is bad for central cities. Wallets are under stress. Retailers fear the planned changes (and rates rises) will make all this worse. There’s certainly a feeling neither WCC nor LGWM really understands the world now is different to pre-Covid. If construction is managed without real focus on business wellbeing that would add to the problem.
One US study concluded ‘One thing we have learned for certain is that we can’t just take cars out of downtowns and expect suburbanites to come flocking back. But another thing we have learned is that the desire for urban walkability has never gone away. There is reason to hope that we might eventually get it right.’
So Wellington Live thinks the jury is out. There are actions the authorities could take to improve the chances of positive outcomes, but success is by no means guaranteed.
Pulling out of LGWM would have been an own goal for Council. Successive Governments have got frustrated with Wellington over transport proposals, though not recognising that they themselves are often as much to blame. The Councils do need Government to stay committed to Wellington. But could this elephant be eaten in stages and see how it goes? Why not do temporary works in some parts and see how that works – just as WCC is doing with cycleways? If reducing bus congestion is a key objective why not add bus passing bays at bus stops and why not allow the few private vehicles and servicing vehicles in outside of peak hours? That would help with personal safety at night too.
We also think WCC and LGWM are far more confident of public support than is warranted. The original consultation submission numbers were no more a proper opinion poll than other feedback surveys which have had the opposite result. There are clearly divided views. Wellington Live suggests a proper poll on all aspects of LGWM would be valuable.
Finally there are also questions LGWM and WCC need to answer about costs and benefits and who pays. When LGWM started it was stated that Government would pay 60%, and the City and Regional Councils 20% each. Now that appears to be just the arrangement for the ‘planning’ phase. For building Thorndon and the Golden Mile WCC is up for 49%, Waka Kotahi 51% (so that’s just the normal cost sharing arrangement for any roading project) and GWRC just a few bus shelters. To make matters worse for WCC ratepayers it will also lose 268 carparks from the Golden Mile and side streets, meaning rates will rise further to cover the lost revenue. Doing the math we think this week’s report to the mayor and councillors severely underestimates the lost revenue, and was probably based on Covid period parking levels.
If parking occupancy was at just 50-60% the revenue loss would be double what the report says. Cr Tony Randle, who last week correctly calculated WCC officials had made a major error in calculating the benefits from reducing speed limits citywide again says there are major errors in the LGWM benefit: cost calculation. We think he is correct, that LGWM is over-optimistic, and additionally some of the purported benefits are questionable in their entirety.
So it’s green for go, but many questions remain.
Written By Charlie Fox 23/06/2023
‘Addressing the challenges to social cohesion’ should be compulsory reading – especially for people in positions of power, particularly in central and local government, and especially at Wellington City Council! Last week’s report by former Chief Scientist, Professor Sir Peter Gluckman, and eminent colleagues from think-tank Koi Tū discusses stresses on our society’s very cohesion, alarmingly saying that ‘depending on how we react to a broad range of stresses, this increasingly fragile cohesion could be pushed past a tipping point.’
The report says social cohesion relies on trust in each other and in our institutions – public and private. It says trust is declining. It particularly sheets that home to media, social media, politicians, and the response to the pandemic. It warns of risks of ‘greater polarisation and division’.
The report says social cohesion relies on trust in each other and in our institutions – public and private. It says trust is declining. It particularly sheets that home to media, social media, politicians, and the response to the pandemic. It warns of risks of ‘greater polarisation and division’.
It also says ‘there is growing evidence of autocratic tendencies in some democracies’ – including New Zealand. In particular, it says our Parliamentary system lacks checks and balances. It says democratic accountability relies on effective opposition, encouraging debate, effective critiquing of proposed policy – for example by effective select committees, OIA process, Ombudsman and Auditor General or, we think, independently minded councillors. The report also says urgency should not be misused and we need a free, independent media. Important messages for both central and local government.
The report says, ‘underlying the issues of confidence in both central and local government is the rather perfunctory or tokenistic approach to public consultation,’ and that ‘a democracy depends on politicians engaging meaningfully with the public.’ It says, ‘when citizens believe their voices have been heard and they have a genuine part in the debate, irrespective of the outcome, they will feel they have been more fairly treated and included,’ and recommends separating consultation from the political process. Wellington Live suggests that should include independence from officials overly committed to any particular proposal being consulted on.
Wellington City Council should really think very hard about these messages, particularly in the transport and planning areas where its ideological bulldozer has been operating on full throttle. This week we owe a debt of gratitude to Cr Tony Randle for picking up a major error in Council’s analysis of the benefits of reducing speed limits on about 85% of all city and suburban streets, so the proposal has rightly been sent back to the drawing board – mid public consultation.
Mayor Tory Whanau expressed disappointment, saying councillors and the public rely on accurate information from officers, and ‘we have reviewed this situation to ensure it doesn’t happen again.’
That’s one quick ‘review’! Actually, it’s not just about officers. The mayor and councillors’ job, like any governors, is to take off the ideological blinkers, to ask good, intelligent, probing questions, testing information received from officials. The more important the issue, the more controversial, the more significant the consequences, the more it should be tested and potentially changed – by officials, by mayor and councillors, and as Peter Gluckman says, by us, the public, through genuine consultation.
It is easy for the mayor to say action has been taken ‘to ensure it doesn’t happen again’ (significant errors have been made many times before) but this means councillors being allowed and encouraged to do their job as Cr Randle has done so well here, and not being actively discouraged by officers or by their colleagues. It requires officers and fellow councillors to really think about the issues, not just ideology. Wellington Live hears ‘opposition’ councillors are now often actively discouraged from asking difficult questions, so all this means a real culture shift is needed at WCC. We will be watching.
Written By Charlie Fox 18/06/2023
It’s been a challenging couple of weeks for Wellington City Council and particularly for Mayor Tory Whanau, with some legacy ups and some contemporary downs. The big up is the opening Takina, Wellington’s flash new convention and exhibition centre the week before last. A stunning building inside and out, Takina was delivered within 5% of budget and ahead of time, both remarkable achievements, especially given construction was mostly done during Covid! Takina is expected to create 550 EFT jobs, boost the local economy by $45 million annually, and be visited by 500,000 people a year. Takina describes itself as ‘The Nation’s Meeting Place,’ and 140 plus multi-day conferences have already been booked. While all the decisions to build and operate Takina were made under previous Mayors this is still very much a good news story for Council and for Mayor Whanau, and will bring more life and encourage development in the central city.
Not so good are some really mixed messages about water pipes. While we can all see Wellington Water doing a huge amount of very welcome work on sewer pipes in central Wellington we also still see far too many leaking water pipes and tobies all over Wellington, Porirua and the Hutt. Now we’re warned about possible water shortages if we have a dry summer and may need to be boiling water. Despite all this, in recent weeks both Wellington and Upper Hutt Councils have complained Wellington Water hasn’t made an adequate case for more funding to get on top of those same leaks. Something appears to be breaking down here.
Speaking of breaking down, Mayor Whanau swept to election victory in large part on the promise of bringing people together. However, 7 councillors have now come out in revolt against Let’s Get Wellington Moving. It is little surprise to see where the political fault line in Council lies. It is also clear that this split has never been addressed by the Mayor, and it exists across a lot more than just transport issues. Her big advantage is 7 is still a minority of councillors.
There are also splits over Council’s budget which passed recently including a rates rise of 12.8%. Councillor Ray Chung has even been wrongly chastised over circulating ‘alternative’ submission forms on the long-term plan.
Wellington Live thinks many Wellingtonians will agree with Cr Chung and like-minded councillors calls for WCC to try to save some money.
Most other Councils at least look like they are trying to respond to the ‘cost of living crisis’ by trying to reduce rate increases.
Wellington Live thinks Councillors should look at the answers the ‘Independent Herald’ got when asking residents ‘what have you stopped buying/doing due to the cost of living crisis?’ All their small sample of people asked said they had cut back on food costs and ‘luxuries’ like going out on a date.
Also on bringing people together and ‘getting Wellington moving’, the Mayor recently self-reported on her social media abruptly leaving a meeting of 100 or so Oriental Bay residents. She said she was ‘heckled and booed’ and she followed up on MSM calling the residents’ ‘entitled’.
This characterisation is at odds with multiple reports from meeting attendees who described the questioning as polite and ordinary, if frustrated by her answers. One councillor Nicola Young present said that on the scale of 0 (gentle) to 10 (very robust) it rated only a 1.
She’s also been called out for using identity politics to justify her departure, so this episode is a bit of a problem on several levels for the Mayor.
But ending on a positive note. Councillors conditionally approved the proposed Pasifika Fale Malae on the corner of Frank Kitts Park, where the carpark building is now. The Fale (meeting house) is intended as a place of pride and identity for Pasifika, as well as being available for general community and university use. According to the Council report on the Fale there are many issues still to resolve including the unbudgeted cost of redeveloping Frank Kitts Park, commercial and community use arrangements with the Fale Malae trust (who pays for what?) and getting resource consent for the Fale. All going well construction is planned to start in late 2025 and take 18 – 24 months.
Golden Mile project supporters responded saying it will bring more people, more customers, more life back into the city. They say that is what happens all over the world when pedestrianisation occurs. However, they do appear to ignore the cumulative effects of removing parking and servicing on multiple streets, and both undersell the proportion of visitors who come by car while saying it is still essential to remove them from the Golden Mile.
This week’s big Council meeting featured three debates on the Golden Mile and Thorndon. Cr Diane Calvert’s motion of no confidence in LGWM was defeated 9-7, funding for the two projects was approved (same 9-7 split) and a raft of traffic resolutions approved to allow them to go ahead. (mostly the same 9-7)
